Business Basic Foundation Pieces
Previously I spoke about building a foundation for your business.
So, let’s talk about the 4 basic foundational pieces; How they are created, and What information will be needed to create them.
The four pieces are:
- The Vision
- Makeup of your financial world
- Shelf assets
- Three pre-startup business strategies based on the vision
Creating your business vision (click for PDF worksheet)
A business is designed to achieve the vision for that business. The vision is not the goal for the business. A vision is how the business looks once it is complete. A goal is looking to the future, a vision is a look back to how you arrived at the results.
So, your vision is the business when finished. From the point of view of the vision you will be able to look back to see the process of its creation. You will describe what the business has contributed to your “personal aims.” Personal aims are things and ideas that you provide to the world by your actions. These contributions are how the world will remember you.
Your Vision Will Describe:
- What types of people you have worked with
- What work environment you worked in
- What work hours you chose to have
- The kind of customers you served
- Which of your talents or skills were used
- What kind(s) of educational opportunities where made available to you and your associates
- What travel you had and when you have decided not travel
- What other family members were involved and what they contributed and learned
- How the way you liked to spend your time contributed to the business
- How your money requirements were met and exceeded
- What type(s) of fringe benefits other than money the business supplied to you and others
- What kinds of acknowledgements – accolades have you received
- How you contributed to your world, community, customers
- How the contributed capital was returned and compensated
Your Financial World Playing Field
Creating the playing field picture.
This picture will show your financial world and its many aspects. Draw in the “playing field picture” all of the “players” in your game. “Players” are separate entities or activities that make up your financial world. The sample below shows some of the possible players and some of the relations between players. (click for a PDF version of the sample Financial World Map)
To complete the process, take each player separately and write out in as much detail as possible, a description of the entity or method of holding, its purpose, why it was acquired or developed, what you expected from the player over time, how it is meeting your expectations, and how that player relates to the other players in the playing field.
Shelf Assets Worksheet (click for PDF worksheet)
Shelf assets are resources that may be used to begin or expand your business. Shelf assets extend well beyond those things and concepts that actually belong to you or to the business itself. When looking at these resources, don’t limit yourself to looking close to home. Be on the lookout for resources held by others that you may have access to under some circumstances.
The list of shelf assets will contain some or all of the following, and could include other items not on this list. You should try to include any resource or asset that might be available to your business, and may include people other than yourself who are willing to share knowledge and/or information that will be useful or needed.
- The amount of available cash that can be used in the business.
- Identification of needed development teams.
- Identification of respective team members.
- Any tools, tangible or intangible that you own or can acquire that will be useful in operating the business and/or accomplishing those tasks needed to track business activity.
- Proprietary information or processes that can be used in the business.
- Available lists of customers, vendors, and workers. These lists could provide sources of sales, supplies and services, or workers for your business.
- All individuals you know who have special knowledge or skills who would be willing to share those skills or the information with you as you need it.
- All individuals and organizations you can look to for any kind of assistance.
- Anything else you can think of that may be of use to your business.
Your three basic strategies
Strategies determine how you will address various aspects of the business. You should determine all three of these plans before beginning the start of the business or the start of the growth of your existing business.
Your Entrance Strategy
Describe: How your getting into this business, what will this business provide to you, how this business will meet your financial requirements. The business will you be in.Based on your basic strengths and skills describe what existing market need will your business meet. How you intend to enter the choosen market. How this business will satisfy existing market needs. This description will include:
- What business you will be in, what will the business do.
- What type of business entity you will use.
- Who you will use as business advisors.
- When you need other people’s labor, how will you acquire that labor; employees or contractors.
- What governmental agencies will you need to contact, when?
- What types of insurance will your business need, when and how much will these insurances cost.
- Will you or any of your employees need to be licensed.
- Will your business need any type of license.
- Do you have any experience in this or a similar type of business.
- If you are new to this type business how, when and where will you learn the business.
- If you will have partners or investors, do you have agreements with them regarding who is going to do which functions, how and when they will reap benefits- be repaid.
Your Operating Strategy
The structure may be to; (remain small with few employees and micro-managed by you; somewhat larger with several employees with you as primary manager but using middle managers; large operation with many employees and the likelyhood that you will eventually have to step asside for professional management). How your business will meet the needs of the six groups of people you will need to deal with; (Owners, Customers, Workers, Vendors, Financers, and the Community). The management style will you use in the business. The operating strategy will address:
- Marketing strategy
- Management Strategy
- People strategy
- Operations strategy
- Growth strategy
Your Exit Strategy
When, how and with what will you leave this business. How you will get out of the business. How you will know it is time to leave the business, how will you know when the business has met your intentions for starting the business?